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shanthan_kesharaju

Builder Markup in Allowances

8 years ago

We are building a custom house and we have requested custom recessed lighting in a family room. The builder gave us a quote for $400 per light and when i looked up the exact item online, the same light from the same company costs 100$. When asked about it, he is saying $300 is the effort involved in the wiring etc. This feels very wrong, as there is nothing special about this compared to other recessed lighting in the house, except the type of light is different. I feel he is jacking up the price, since we are very interested in that type of lights. Is the builder allowed to jack up the prices and make profit out of the allowance amount he gave us ?

Comments (17)

  • 8 years ago

    Builder can quote whatever they want. The question is are you allowed to purchase on your own or do you have to use them on upgrades? At the least, it will be a nuisance to warranty your own stuff if it comes to that.

  • 8 years ago
    last modified: 8 years ago

    Read the contract. Allowances and change orders should be spelled out.

    To avoid this, spec out the lighting you want at the start. Voila, no allowances and no upcharges!

  • PRO
    8 years ago
    Are you sure you've included all the pieces? housing, trim, lens, etc?

    My standard recessed fixtures hard cost is about $25-30, with labor (rough & trim) and wire installed about $75.... but I'm looking at a supplier quote for 125 x 4 piece recessed fixtures that exceeds $50k.... yes over $400 each before we touch them.

    My client got wide eyed before I needed to price.
  • 8 years ago

    Yes. it is $400 installed. (Cost is $100) If I go with his standard recessed light it is $100 installed. Does the wiring costs vary so much for a different light fixture. The light fixture i want is http://www.waclighting.com/sites/waclighting.com/files/product/specsheet/MT-330.pdf

    where as his standard fixture is similar to this https://www.homedepot.com/p/Halo-RL-5-in-and-6-in-White-Integrated-LED-Recessed-Ceiling-Light-Trim-at-Selectable-CCT-2700K-5000K-665-Lumens-RL56069S1EWHR/304533541

  • 8 years ago

    Standard grade recessed lighting like you listed from HD are extremely common and every electrician and sheetrock person you find will have installed many of them in previous houses.

    The upgraded fixture is much different to install, and appears to have quite a few options and lighting directions to figure out so that you get it placed correctly. I don't know if its worth what you are being charged for installation, but I would expect the installation cost to be higher than for a basic fixture.

    You need to also verify that the cost you have been quoted for a self purchase (which I think is fairly cheap) does include all the required pieces.

    Bruce

  • PRO
    8 years ago
    last modified: 8 years ago

    OP listed the trim (only) for a triple light par30 fixture WAC Mt330. If you can get the trim for $100, that's a bargain and about $30 below other prices I can find, before tax and shipping. I found the housing WAC Mt330Hs on Amazon for $198. Maybe you should ask more detailed questions. Make sure the bulbs are also included.

    This isn't a Home Depot item. His quote may be low.

  • 8 years ago

    Also, unfortunately it doesn’t matter if it “feels wrong” to you. Unless he’s violating the contract with regard to upgrades and change orders (and odds are he’s not) then he can do whatever he likes, including a $300 profit per light, if he chooses. It sounds like that’s not what he’s doing, but it’s inportant to k ow he can. That’s why many on here advise knowing what you can easily upgrade later v. what you can’t, doing a realistic price comparison, and only upgrading what you can’t easily do later or is genuinely a good deal.

  • PRO
    8 years ago
    last modified: 8 years ago

    I'm guessing $25-35 markup per light. Look at the cost nearly $300 before install.

  • PRO
    8 years ago

    The fixture you are interested in isn't your run-of-the-mill recessed light. I suspect it's intended mainly for commercial applications.

    Please note that the particular fixture is not rated for insulation contact so it may not be appropriate in all locations in your home.

  • 8 years ago
    The light is listed as 146 here with a coupon it comes to 130 cost+tax+shipping

    https://www.lightingdirect.com/wac-lighting-mt-330-3-light-6-adjustable-invisible-recessed-trim/p3423755?term=mt 330&uid=3423754
  • 8 years ago

    ^^^ then materials cost + 2X for labor (which seems to be what I am seeing) gives you $390 without your tax and shipping.


  • 8 years ago

    Yes. 130 for cost+tax+shipping and 270 for labor. I have 10 of these lights to be installed in one room in the ceiling and he is charging 2700 just for labor.

  • PRO
    8 years ago
    again, it doesnt include the housing part for another $198.
  • 8 years ago

    Just to further clarify Jeffrey's point - Recessed lighting usually has two separable parts. (1) Trim which is the decorative part you see, and (2) housing which is the part that is wired in the ceiling. The housing is installed during the wiring phase and the trim is usually installed after drywall is finished.

    You are looking at the price for half of your fixture. The complete price is closer to $300 to $350 per light. After mark-up $400 seems reasonable.

  • 8 years ago

    Are you saying 130 for light and 198 for trim ? So total fixture cost is 328 and his labor and markup is 72$

  • PRO
    8 years ago

    Yes. The electrician still has to hang the fixture, run cable, then hang the finish trim at completion. They might get a slightly better deal on the housing and trim.

    Don't forget sales tax & maybe shipping.

    MT330 housing